Financial Literacy Through Digital Literacy

Personal Financial Help with Financial Advisor

Financial Literacy Through Digital Literacy

By Ray Adamson, Founder and President of Adamson Advisory Group Ltd.

In my work with financial advisors over the years, one of the key strategies for helping them achieve success has been through optimizing their business – and one of the great levers for accomplishing this is technology. With the right technology, advisors can provide appropriate service to their clients and prospects efficiently and quickly, and even offer tools to their clients for self-service.

In the current market landscape, advisors are embracing technology in support of educating their prospects and clients, helping them plan and purchase the right products to reach for their goals – and those who don’t risk being left behind

But are these digital tools, technologies and resources getting into the hands of everyone?

We see digital resources everywhere being offered to consumers that are aimed at helping them educate themselves or do their own planning. Given the abundance of them, it is easy to assume everyone is taking advantage of these tools and planning their financial futures. Unfortunately, this assumption isn’t quite accurate, as there is a significant percentage of our population without access to both these tools or personal financial advice of any kind. Without a clear opportunity to participate in financial planning, or to even learn the basics of finances, it is understandable that they are left unable to make the best financial decisions for their individual circumstances. This was brought dramatically to light when PC Financial ran a recent study that found 44% of Canadians feel that they are not completely equipped with the advice and tools needed to plan for their future.

For some Canadians, lack of appropriate access to digital resources, technology, and tools is a fundamental barrier to participating in the digital financial marketplace. A major concern is that the lack of digital infrastructure is a barrier not only to financial inclusion, but also to economic and social inclusion.

Improving accessibility is critical for those who do not have the digital access they need to use digital financial tools, resources, products, and services. Without access to financial advisors or planning tools, or the context as to why these resources are important, many are simply choosing to get their information elsewhere.

Social media accounts and online platforms have become de facto resources for “financial advice.” Twitter accounts leveraging hashtags like #fintwit, or the Subreddit r/PersonalFinanceCanada have tremendous followings and, in many cases, are providing what one would interpret as financial advice. This could be a positive in that the average person is getting access to information they might not otherwise receive, but it could also be risky as the average person is getting access to information that might be inaccurate, misleading or even manipulative..

How can people assess what is appropriate for their situation?

“Experts” on these platforms often aren’t appropriately licenced or even worried about compliance. People with strong public followings are endorsing cryptocurrencies or real estate strategies, and their fame lends them (and the products they’re representing) credibility. While some of these approaches may be appropriate for some people, they may not be appropriate for all people.

Access to the digital infrastructure is a key step, but access alone isn’t enough. There needs to be strong support available to help people understand and overcome their lack of digital literacy. Without strong support, how can we ensure Canadians have the ability to competently and confidently use technology and tools as ubiquitous as online banking to manage day-to-day transactions, or search online for financial information appropriate for their current reality and future goals?

Physical and/or language barriers could make using available tools challenging (or impossible). Online tools and calculators need to ensure they are friendly to all audiences – for example, online applications can be especially difficult for those with language, cognitive, or other barriers.

Our industry is embracing technology, but on its own it is not a solution – it is an enabler. There is much talk of the “omni-channel” experience for clients and prospects – an experience which gives them the information they need, when they need it and in the manner in which they want it – be it online self-service, call centres, mobile messaging, or in-person. Our opportunity as advisors is to ensure that we enable all Canadians to be able to take advantage of an omni-channel experience with the support needed to break down their barriers, and  I look forward to a future in which the expertise of financial advisors is a cornerstone in building and developing them.

Raymond Adamson

Ray Adamson is the Founder and President of Adamson Advisory Group Ltd. As a financial advisor, consultant, practice management coach and speaker, Ray has helped Canadian business owners, as well as senior management and advisors at the largest carriers and distributors in North America, take their business to the next level. He is a long-term member of Advocis and an active volunteer on the Technology and Innovation Committee.